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Browse through retailer sales ads or walk down the aisles of a
Target or a drugstore, and you may be surprised by how many items
are being offered at or around the $100 mark. Suddenly, it seems
like a myriad of self-pampering products are popping up to soothe
us, entertain us and/or simplify our lives--all with much higher
price tags than the previously accepted price of $19.99. Have
consumers' attitudes shifted to make $100 the new affordable
impulse buy?

Daniel Howard, chair of the marketing department at Southern
Methodist University's Cox School of Business in Dallas and
consumer research and behavior expert, says inflation is one factor
in the rising costs of products. But he adds that, psychologically,
consumers are also allowing price points to move upward, especially
when it comes to gadgets. "Americans are fascinated and
obsessed with technology-type goods and are willing to pay somewhat
of a premium for technological ways of doing everyday tasks, even
though many times the technological method of doing it is more
difficult and arguably less efficient," Howard explains.

Entrepreneurs can feasibly offer items like electronics or
anything that "would qualify as a reasonable gift,"
Howard says, pricing right up to this psychological price barrier.
Howard points out the academia-accepted odd-even pricing, noting
that selling an item for $99.99 as opposed to $100, for example, is
perceived by consumers as "significantly less expensive."
However, he adds that the latter, used by retailers such as
Neiman-Marcus, is seen as being significantly higher in quality. So
when pricing your product, take into account whether you're
positioning it for quality or as an economical purchase.

As the trend continues, entrepreneurs and businesses will bring
increased competition to the field, which will drive down prices if
consumers' fading sense of novelty doesn't do it first,
but, Howard says, "We're not through with this yet."
Until then, let the electronic toothbrushes, shiatsu back
massagers, golf-score PDAs and their brethren reign.